We are, as a population, constantly being encouraged to take control of our finances but it’s increasingly apparent that those of us who do so are being seen as easy pickings by HMRC.
The removal of the tax-free pension dividend allowance, the slow erosion of the lifetime allowance and the annual allowance, and that’s just pensions.
Tony Hazell has also pointed out in his column that those of us who choose to pay for private medical insurance, through our employer, end up paying a premium via our tax codes.
You could also say self employment is the ultimate form of financial empowerment. Those who work on a sole trader basis have to take total responsibility for their own finances.
Sick pay, holiday pay, even to some extent maternity pay - none of these are afforded to the vast majority of those working under the banner of ‘sole trader’.
In last week’s Spring Budget, the Chancellor of the Exchequer Philip Hammond dealt a cruel blow to the self employed, by announcing an increase to their National Insurance contributions.
Most self employed people do not earn such vast sums. In fact many large corporations rely on sole traders to fulfill key roles in their business, and then take ages to pay them; but that’s a gripe for another time.
The reality is sole traders are those who may be in the early stages of setting up a business - they may not yet be employing anyone - or they may be working part time to juggle family commitments (both children and parents)
They are not the people the chancellor should be targeting. And NI as I have argued here before is a strange beast. Although it is supposed to be set aside for our pension contributions it isn’t, it is used to pay out the pensions of today’s (largely wealthy pensioners).
We are told that the increased revenue generated from higher NI will go towards social care which sounds great, but isn’t that what taxation is for?
Why not encourage more of us to put money into a pension by scrapping NI and letting us decide where to put our pension money.
